RBI Committee report on MSMEs recommends PM led National Council for MSMEs, rejig of MSMED Act

RBI Committee report on MSMEs recommends PM led National Council for MSMEs, rejig of MSMED Act New Delhi, June 25 (KNN) The Report of the ‘Expert Committee on Micro, Small and Medium Enterprises’ has been released. The Committee has recommended a National Council for MSMEs to be set up at the apex level under the Chairmanship of the Prime Minister with the Ministers for MSME, Commerce & Industry, Textiles, Food Processing, Agriculture, Rural Development, Railways and Surface Transport being members. The States are to have similar State Councils for MSMEs, for better co-ordination of developmental initiatives. Further, empathizing with pain that MSMEs undergo dealing with plethora of laws, the Expert Committee recommends ‘a comprehensive and holistic MSME Code’ to put an end to ‘territorial jurisdiction based and arbitrary inspection system’.

 

It is expected that the new law will be able to address the major challenges, relating to physical infrastructural bottlenecks, absence of formalisation, technology adoption, capacity building, backward and forward linkages, lack of access to credit, risk capital, perennial problem of delayed payments, etc. The committee was set up by Reserve Bank of India under Chairmanship of U.K. Sinha former SEBI Chairman January this year. The Committee found the turnover based MSME definition proposed by the Government ‘rational, transparent and progressive’ and easier to implement after introduction of GST.